For the love of money is the root of all evil

Economic Inequality—It’s Worse Than You Thought

Janet Yellen, Ben Bernanke, and Jerome Powell have each bemoaned U.S. economic inequality and then asserted that it’s everyone else’s fault. On the blog and in our speeches, we counter that post-crisis monetary and regulatory policy had an unintended but nonetheless dramatic and destructive impact on the income and wealth divides. In doing so, we often point to just how much worse and how much faster inequality became as post-crisis policy took hold. Demographics, technology, and trade policy didn’t change anywhere near that much that fast. Now, a new study from the Federal Reserve Bank of Minneapolis takes the story forward with a trove of data evaluating U.S. economic inequality from 1949 through 2016. For all the recovery and employment the Fed cites in its equality defense, these data tell a far different tale.